Recently, the Hanover Shoe and Illinois Brick proscriptions of raising pass-through issues under Federal antitrust law have been under pressure. The Antitrust Modernization Committee Report has recommended that the Illinois Brick rule be abolished, and DOJ antitrust head Makan Delrahim has suggested that Apple v. Pepper before the Supreme Court might open the door to overturning Illinois Brick.

Dr. Janet Netz participated in the ABA’s Antitrust, UCL, & Privacy Law Section’s program, “Will Apple’s App Store Lead to the end of Illinois Brick? Pepper v. Apple and calls for a new antitrust damage regime,” on Thursday, July 26, 2018, in San Francisco. The panel consisted of attorneys from the plaintiffs’ and defense bars and the Deputy Attorney General in the Antitrust Section of the California Attorney General’s Office. Dr. Netz discussed the economics of estimating pass-through rates and the economic feasibility of overturning Illinois Brick’s prohibition of indirect purchasers bringing antitrust cases under federal antitrust law. Dr. Netz has testified in numerous antitrust cases on behalf of indirect purchasers under repealer states’ antitrust laws, as well as in Canada, empirically estimating pass-through in a variety of industries. Based on scholarly advances in the study of pass-through, including advances in data availability and computing power, Dr. Netz feels that it is quite feasible to estimate the portion of an overcharge borne by each level of the distribution chain in most circumstances, contrary to the situation when Hanover Shoe and Illinois Brick were promulgated. She also discussed the complications of overturning Illinois Brick in light of forty years of case law rather than establishing a regime de novo.